How do you trade pre-market on ASX?

[Dominover]

What does it mean to trade the pre-market in stocks on the ASX?
I"m not sure how this is done. Before the market opens, the chart doesn't move at all and I"m assuming the orders being input can't be seen either.

I know there's a 20 minute window either side of open and close where you can place trades.

I could have this wrong but it trading the pre-market on ASX stocks just trading via the order book (tape) only?

I hear allot of traders talking about this in the U.S, but as always they seem to have so many more resources than us here in Australia.

 

[Chronos-Plutus]

What does it mean to trade the pre-market in stocks on the ASX?
I"m not sure how this is done. Before the market opens, the chart doesn't move at all and I"m assuming the orders being input can't be seen either.

I know there's a 20 minute window either side of open and close where you can place trades.

I could have this wrong but it trading the pre-market on ASX stocks just trading via the order book (tape) only?

I hear allot of traders talking about this in the U.S, but as always they seem to have so many more resources than us here in Australia.

The market does a price match on the open, from orders that were placed pre-open. That is why you will get an indicative open price before the open.

https://www.asx.com.au/about/trading-hours.htm

 

[peter2]

There is no pre-market open trading on the ASX. Orders can be placed and they're able to be seen in the queue prior to the market opening. They provide an indicative open price. The ASX opens gradually and alphabetically over a 15 min period. The closing auction is conducted over a 9 - 10 min period.

The US markets do allow pre-market trading that opens 90min before the official open time. The volume is usually very low. However recent news does increase the pre-market trading significantly. The pre-market trading indicates the probable opening price and this provides probable trading opportunities for short term day traders.

 

[over9k]

The open price is also dictated by an algorithm that weighs price & quantity of desired sells against price & quantity of desired buys to get a figure. Hence why you see those stacks of orders for waaay off the previous day's close - people know the buy/sell price won't be whatever they've put down, they're just making sure they get their orders filled asap.

 

[Rustyteeth]

There is no pre-market open trading on the ASX. Orders can be placed and they're able to be seen in the queue prior to the market opening. They provide an indicative open price. The ASX opens gradually and alphabetically over a 15 min period. The closing auction is conducted over a 9 - 10 min period.

The US markets do allow pre-market trading that opens 90min before the official open time. The volume is usually very low. However recent news does increase the pre-market trading significantly. The pre-market trading indicates the probable opening price and this provides probable trading opportunities for short term day traders.

They open alphabetically - well now I know why z1p always opens late. Thank you for that !

 

[Dominover]

Ok, thanks for the information. I didn't think we had the same pre-market capabilities as the US.
So I would look at the order book for a build-up of orders at best.
That' pretty much answers it.

 

[Beaches]

What does it mean to trade the pre-market in stocks on the ASX?

This has been posted previously in the Dump it Here thread, however, it may help to have it here again given the title of the thread

From 7:00am to 10:00am the market is in Pre Open mode. During this time, orders can be placed but will not trade although the orders can be seen by everyone. As the orders being placed during Pre Open are not trading, there will be Buy orders that are above Sell orders and Sell orders that are below Buy orders. These orders form the overlapping bids which will be used by the opening auction algorithm.

The ASX uses an algorithm to match the volume and price of all overlapping Buy and Sell orders to calculate and set the opening price. As different Buy and Sell orders are entered into the market from 7:00am to 10:00am, the algorithm is constantly looking at the overlapping bids and a likely opening price will be displayed. This likely opening price gives everyone an idea of where they will need to set their bid in order to get filled at opening.

As a very simple example, if a stock has the following Buy and Sell bids during Pre Open:

Buy Orders
2000 @ 10.51
7000 @ 10.50
1000 @ 10.45
1000 @ 10 44

Sell Orders
1000 @ 10.48
2000 @ 10.49
6000 @ 10 50
1000 @ 10.56
1000 @ 10.57

In the above example there are 2 Buy orders and 3 Sell orders that are overlapping (coloured red). If we assume the ASX algorithm looks at these overlapping bids and calculates the opening price at $10.50, all of the overlapping (red) bids would be filled at $10.50 when the market for this company opens.

At 10:00am the market commences a staggered opening alphabetically as follows:
10:00:00 - Stocks A - B
10:02:15 - Stocks C - F
10:04:30 - Stocks G - M
10:06:45 - Stocks N - R
10:09:00 - Stocks S – Z

Once each stock opens, it then trades normally throughout the day until 4:00pm when the market goes into the closing auction.

If there are no overlapping bids for a particular stock, then no opening auction occurs. The opening price will be the price of the first trade that goes through after opening.

 

[Dominover]

This has been posted previously in the Dump it Here thread, however, it may help to have it here again given the title of the thread
.

Thanks very much for this.. Good level of detail too. Much appreciated.